- The new plece of equiprtsent with have a cost of $2,400,000, and it wil be depreciated on a straight-line basis ever a period of five years. - The old machine is also being depreciated on a straight-line basis. It has a book value of $200,000 (at year 0 ) and three more vears of depreciation left ( 550,000 per year). - The new equipment will have a salvage value of 50 at the end of the project's life (ovar 5). The old machine has a current salvoge value (at year o) of $300,000. - Replacing the old machine will reouire an investment in net moeking capital (NWC) of $20,000 that witl be necoversed at the end of the project's lfe (year 5 ). - The new mochine is more efficient, so the incremental increase in operating income before taxts wit increase by a total of $600,000 in each of the next five years (rears 15). (Mint: This value represents the difference between the reverves and operating costs (including depreciation expense) generated using the new equipment and that earred using the old equipment.) - The project's requind rate of return is 10% - The company/s anoul tax rote is 35%. Complete the following table and compute the incremental cash furws assocuted with the replacement of the old equipment with the new equipment. The net fresent value (Nir) of this replacement project is - The new plece of equiprtsent with have a cost of $2,400,000, and it wil be depreciated on a straight-line basis ever a period of five years. - The old machine is also being depreciated on a straight-line basis. It has a book value of $200,000 (at year 0 ) and three more vears of depreciation left ( 550,000 per year). - The new equipment will have a salvage value of 50 at the end of the project's life (ovar 5). The old machine has a current salvoge value (at year o) of $300,000. - Replacing the old machine will reouire an investment in net moeking capital (NWC) of $20,000 that witl be necoversed at the end of the project's lfe (year 5 ). - The new mochine is more efficient, so the incremental increase in operating income before taxts wit increase by a total of $600,000 in each of the next five years (rears 15). (Mint: This value represents the difference between the reverves and operating costs (including depreciation expense) generated using the new equipment and that earred using the old equipment.) - The project's requind rate of return is 10% - The company/s anoul tax rote is 35%. Complete the following table and compute the incremental cash furws assocuted with the replacement of the old equipment with the new equipment. The net fresent value (Nir) of this replacement project is